AUD / USD updates multi-year highs, approaching 0.7500

• AUD / USD is posting impressive daily gains on Wednesday.
• Risk flows provide a boost to the AUD ahead of the US session.
• The US Dollar Index remains below 91.00 despite a modest rally.

After a consolidation period of three days, the AUD/USD It gained traction on Wednesday and rose to its highest level since July 2018 at 0.7485. At time of writing, the pair was up 0.92% on the day at 0.7480.

Earlier in the day, data from Australia showed that Westpac’s Consumer Confidence in December improved to 4.5% from 2.1% in November and helped the AUD start the day on a strong footing.

Broad-based USD weakness helps AUD / USD rise

Additionally, the risk-positive market environment allowed the Australian dollar to gain strength while making it difficult for the dollar to find demand on Wednesday. The increased hopes that US lawmakers will reach an agreement on the coronavirus aid bill before the new year appear to have given a boost to confidence. Reflecting market optimism, S&P 500 futures trading in positive territory and the yield on 10-year US Treasuries was up 2.5% on the day.

Later in the day, JOLTS wholesale inventories and job openings will be the only data on the US economic agenda. Investors are likely to ignore these numbers and remain focused on risk perception. If the major Wall Street indices hit new all-time highs, the US Dollar Index, which is currently losing 0.18% to 90.80, could extend its daily decline.

On Thursday, the Reserve Bank of Australia (RBA) will publish its Bulletin and the Melbourne Institue will publish the Consumer Inflation Expectations for December.

Technical levels